CEQA Changes Proposed

Over the past four months, Sacramento lawmakers have introduced a number of bills to tinker with the state’s premier environmental statute, the California Environmental Quality Act (CEQA). While it is too early to know whether any of the proposed changes to CEQA will be enacted, each could impact the building industry. Below are a few to watch as they wind their way through the legislature:

SB 224 (Jackson) would fundamentally change how CEQA analysis is performed. Today, to determine whether a project would have a significant adverse effect on the environment, a lead agency looks at the change to existing environmental conditions (usually referred to as the “environmental baseline”) resulting from the project. That change is then measured against the agency’s “threshold of significance.” If the change exceeds the agency’s significance threshold, then it must be mitigated, avoided, or overridden as prescribed by CEQA. In establishing the environmental baseline conditions, the lead agency is not now required to examine whether conditions at the project site, such as existing development, occurred legally and pursuant to a required permit. Unpermitted and illegal conditions at the project site are included within the baseline based on CEQA’s current language and well-established case precedent. SB 224 would change the baseline equation by excluding from the environmental baseline existing conditions resulting from illegal or unpermitted actions, emergency repairs to public service facilities, or other actions necessary to prevent or mitigate an emergency, if such actions were made without CEQA review. This change will require lead agencies, in describing the environmental baseline, to figure out if past illegal, unpermitted, or emergency actions occurred without CEQA review at any time in the past, and then look beyond what actually exists at the project site and speculate on what the condition of the environment would be without those actions. (This approach to establishing the environmental baseline is similar to that historically used by the California Coastal Commission for projects within the Coastal Zone.) SB 224 is set for hearing by the Senate Standing Committee on Environmental Quality on April 19.

AB 890 (Medina) would require an initiative proponent to file a copy of a proposed measure with the local agency and ask for environmental review of the measure. The local agency then has 30 days to determine if the action proposed by the initiative is subject to CEQA, and if so, whether it has the potential to significantly impact the environment. If it has such a potential, the proposed measure cannot be adopted by initiative, but instead could receive a public hearing if a sufficient number of signatures are collected and after CEQA review is complete. Even if the action proposed by the initiative has no potential to significantly impact the environment, AB 890 gives the local agency 180 days to prepare a negative declaration and requires that the negative declaration be circulated for public review and comment for at least 20 days before the meeting at which the legislative body would consider certifying the initiative. Assembly member Medina has described AB 890 as closing “an initiative process loophole that wealthy developers use to avoid environmental review,” but that description fails to capture the bill’s transformative nature. As drafted, the bill constrains the right of any person, not just the wealthy, to have a direct voice in local land use decisions. AB 890’s next hearing will be before the Committee on Elections and Reapportionment.

AB 1404 (Berman) would expand the scope of CEQA Guidelines Section 15332, more commonly known as the “infill exemption.” This categorical exemption promotes California’s goal to locate new development in already developed areas as a way to preserve pristine land and reinvigorate existing communities. As currently drafted, the infill exemption applies in cities, but not counties. AB 1404 would expand this exemption to include proposed development within the unincorporated areas of a county on for projects of no more than five acres which are “substantially surrounded by urban uses.” If this bill passes, smaller infill projects in counties could be approved more quickly, avoiding lengthy CEQA review. The bill awaits its first hearing before the Assembly’s Committee on Natural Resources.

SB 80 (Wieckowski) would make a number of changes to CEQA’s noticing requirements. The most significant of these changes involves projects determined by the lead agency to be exempt from CEQA. Currently, an agency does not need to file a notice of determination with the Office of Planning and Research when it approves a project that it finds to be exempt. SB 80 requires the filing of such notices for exempt projects. This bill adds to CEQA’s required procedures and could trip up an unwary lead agency. Many project applicants already ask the lead agency to file a notice of determination for exempt projects because doing so shortens the statute of limitations for challenging the exemption from 180 days to 35 days. This bill would make that filing a necessity which project applicants should closely monitor to make certain that the agency makes the filing. SB 80’s next committee hearing will be before the Senate Committee on Appropriations.